When providing salary payment services to employees in Vietnam, is it necessary to issue an invoice?

When providing salary payment services to employees in Vietnam, is it necessary to issue an invoice?

Based on Article 4 of Decree 123/2020/ND-CP regarding the principles of issuance, management, and use of invoices and records as follows:

Principles of issuance, management, and use of invoices and records

1. When selling goods or providing services, the seller must issue an invoice to the buyer (including cases where goods or services are used for promotion, advertising, as samples; goods or services are used to donate, gift, exchange, replace salaries for employees and internal consumption (excluding goods in internal circulation for continued production); goods are provided as loans, borrowed, or returned) and must fully record the content as prescribed in Article 10 of this Decree. In case e-invoices are used, they must follow the standard data format of the tax authority as stipulated in Article 12 of this Decree.

2. When withholding personal income tax, when collecting taxes, fees, charges, tax withholding organizations, fee, and charge collecting organizations or tax collection organizations must issue tax withholding records, tax receipts, fees, charges to provide to the person with the income subject to tax withholding, the taxpayer, fee payer, and must fully record the content as prescribed in Article 32 of this Decree. In case e-receipts are used, they must adhere to the standard data format of the tax authority. If an individual authorizes tax finalization, tax withholding records for personal income tax are not issued.

For individuals not entering into an employment contract or signing a labor contract for less than 03 months, the organization or individual paying the income may choose to issue a tax withholding record for each withholding or one record for multiple withholdings within a tax period. For individuals with a labor contract of 03 months or more, the organization or individual paying the income shall only issue one tax withholding record for each tax period.

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Thus, when providing services used to replace salaries for employees, the seller must issue an invoice to the buyer in accordance with legal regulations.

When providing salary payment services to employees in Vietnam, is it necessary to issue an invoice? (Image from the Internet)

How many types of invoices are there in Vietnam?

Based on Article 8 of Decree 123/2020/ND-CP which regulates invoice types as follows:

Types of Invoices

Invoices regulated in this Decree include the following types:

1. Value-added tax invoices are for organizations declaring value-added tax using the credit method for the following activities:

a) Selling goods, providing services domestically;

b) International transportation activities;

c) Exporting to non-tariff zones and cases considered as export;

d) Exporting goods, providing services abroad.

2. Sales invoices are for organizations and individuals such as:

a) Organizations and individuals declaring and calculating value-added tax directly using it for the following activities:

- Selling goods, providing services domestically;

- International transportation activities;

- Exporting to non-tariff zones and cases considered as export;

- Exporting goods, providing services abroad.

b) Organizations and individuals in non-tariff zones when selling goods, providing services domestically, and when selling goods, providing services between organizations and individuals in non-tariff zones with each other, exporting goods, providing services abroad, should clearly state on the invoice "For organizations and individuals in non-tariff zones."

3. e-invoices for public asset sales are used when selling the following assets:

a) Public assets at agencies, organizations, units (including state-owned housing);

b) Infrastructure assets;

c) Public assets entrusted to businesses for management without factoring into state capital at the enterprise;

d) Assets of projects using state funds;

đ) Assets whose ownership rights are established in the public domain;

e) Public assets withdrawn as per the decision of the authority;

g) Materials and supplies recovered from handling public assets.

4. e-invoices for selling national reserve goods are used when state agencies, units in the national reserve system sell national reserve goods as prescribed by law.

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Thus, there are currently 4 types of invoices:

- Value-added tax invoice

- Sales invoice

- e-invoices for public asset sales

- e-invoices for selling national reserve goods

Aside from the aforementioned invoice types, there are other types of invoices, including:

- Stamps, tickets, cards with forms and content specified in this Decree;

- Airline transportation charge receipts; international transportation fee records; bank service fee records except for stamps, tickets, cards formatted and content-based on international practices and related legal provisions.

What are the basic contents on an e-invoice in Vietnam?

Based on Article 10 of Decree 123/2020/ND-CP and Article 4 of Circular 78/2021/TT-BTC which regulate the contents of e-invoices include:

- Invoice name, invoice symbol, invoice form number.

- Copies of the invoice applicable to tax invoices printed by the tax authority following guidelines by the Ministry of Finance

- Invoice number

- Name, address, tax code of the seller

- Name, address, tax code of the buyer

- Name, unit of measure, quantity, unit price of goods or services; amount excluding value-added tax, value-added tax rate, total value-added tax amount per tax rate, total value-added tax amount, total payment amount with value-added tax.

- Signatures of the seller and buyer

- Invoice issuance date

- Time of signing the e-invoice

- Tax authority's code on e-invoices with the tax authority's code

- Fees, charges belonging to the state budget, trade discounts, promotions (if any) as per the guidance at point e paragraph 6 of this Article and other related contents (if any)

- Name, tax code of the organization printing invoices for those printed by tax authority.

- Language, numbers, and currency shown on the invoice

- Other contents on the invoice